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Health Care Sharing Ministries Surge in Popularity, MagnifyMoney Analysis Shows

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

 

melanie
Melanie and Matthew Moore of Wake Forest, N.C., turned to Samaritan Ministries, one of the largest health care sharing ministries in the U.S. when they needed health coverage.

In 2013, Melanie and Matthew Moore were facing a bit of a health care cost crisis. After the birth of their first child, the Wake Forest, N.C., couple decided that it made sense for Melanie, 33, to leave her job and become the primary caregiver at home. Not only did that mean losing an additional income source, but it also meant giving up the family’s affordable health benefits.

The monthly premium for a family plan through Matthew’s employer far exceeded the reach of their newly reduced budget. Melanie began researching health insurance options online, and eventually landed on the home page for Samaritan Ministries. East-Peoria, Ill.-based Samaritan is one of the six major faith-based health care sharing ministries in the U.S.. Members of these ministries pay monthly contributions to a pool of funding that is dispersed among members as they show need.

Samaritan’s plan for Melanie and her son cost just $300 per month — less than half what they would have paid for a family health plan through Matthew’s job. Melanie quickly signed them up. To keep costs as low as possible, they decided Matthew, 31, would continue to receive individual coverage through his employer, which was free.

Even more than the price tag, Melanie says she appreciated the ministry’s faith-based approach to health care. “Health sharing promotes the Biblical ideals of sharing,” she told MagnifyMoney. “It takes a whole different mindset than insurance.”

As health care expenses have ballooned over the last decade, health care sharing ministries have gained in popularity as a lower cost alternative to traditional insurance. Their numbers still pale in comparison to people who receive insurance through employers or the federal marketplace. But health care sharing ministries have experienced an explosion in interest in recent years.

Membership among the top four health care sharing ministries nearly tripled in just the last two years — from a reported 274,000 members in 2014 to more than 803,000 Americans in 2016, according to a MagnifyMoney analysis of membership rates at the top six ministries.

Even the smallest ministry in the bunch, Altrua, saw an eight-fold surge in membership in the last year alone — from 1,000 in early 2016 to 8,000 as of November 2016.

But what exactly are health care sharing ministries, and can they really replace primary health insurance?

At a glance, health care sharing seems like a perfect solution to families facing rising premium costs. However, a deeper look shows that participants take a leap of faith when they eschew traditional insurance protections in favor of health care sharing ministries. MagnifyMoney took a deeper look at how they work.

How Health Care Sharing Ministries Work

Ministry members pay a monthly share to the health care sharing ministry. Monthly share costs can be as low as $21 for an individual, but they can be as much as $780 per month for a family. Share costs vary from ministry to ministry and can also change unexpectedly, much like traditional insurance premiums.

In terms of actual functions, most health care sharing ministries collect monthly shares online, and they disburse funds electronically or through checks. Not all the share money goes directly to helping people in need. Some of the money goes to cover administrative costs, and some money may go into an escrow account. The escrow accounts allow ministry participants to share costs even during periods of high expenses.

Submitting claims

When members incur medical expenses, they submit their bills to the ministry for approval. Approvals are based on the ministry’s published guidelines. Some health care sharing ministries allow medical providers to send bills directly to the ministry. The board then approves or denies sharing. When cost sharing is approved, the member is paid in one of two primary ways: Either the ministry disburses funds to those in need directly, or the ministry directs other members to send their monthly premium payments to the member in need instead.

Health care sharing ministries encourage members to pray for sick members and to send encouraging letters or emails to those in need. Health care sharing ministries specifically publish medical needs to members of the community for the purpose of prayer and encouragement.

“You almost can’t compare sharing to health insurance,” says Dale Bellis, executive director of Liberty HealthShare. “Sharing is about giving not receiving. Your goal is to be available for others in need. Participating is motivated by faith in God and faith in one another.”

The “individual responsibility”

Before sharing a cost, some health care sharing ministries require that members meet an “individual responsibility requirement.” Basically, this is their form of a deductible. The individual responsibility can cost from $35 per incident all the way to $5,000 per incident. For example, Samaritan Ministries requires members to share up to $300 per incident. Medi-Share requires members to pay a non-reimbursable fee of $35 per medical visit or $135 for an emergency room visit (much like a co-pay).

Negotiating bills

One of the benefits of participating in a health care sharing ministry is that many ministries emphasize the importance of negotiating medical expenses. It’s in the ministry’s interest to encourage members to negotiate fees, which leaves all the more money in the pool for everyone else. Some ministries hire third-party firms to negotiate bills, but it’s up to members to take advantage of those services.

Altrua Healthshare directly negotiates on behalf of its members, according toRon Bruno, VP of Business Development.

To incentivize members to negotiate their bills, some ministries offer to waive the member’s individual responsibility portion.

For example, Melanie negotiated a discount at the birth center when she had her second child in 2016. The discount she received more than covered her individual sharing responsibility of $300. That meant 100% of her expenses were shared by Samaritan members.

Finding a doctor

For the most part, ministry members are free to choose primary care doctors of their choice. This is because health care sharing ministries don’t usually share the cost of preventive care. The exception, Altrua HealthShare, has a network of affiliate providers including primary care physicians.

The trouble with choosing “any” doctor is finding a primary care physician who will accept patients who pay in cash. Samaritan Ministries directs their members to use a “cash and direct pay” resource from the Association of American Physicians and Surgeons.

Outside of primary care physicians, each health care sharing ministry allows members to request sharing pre-approval for planned surgeries and other expensive procedures. Most ministries have established processes or arrangements that help their members find the most cost-effective surgeons and specialists in their area.

For example, Liberty HealthShare maintains a list of providers who negotiated bills and accepted payments from Liberty in the recent past. Medi-Share has members search databases for preferred medical providers.

Even with these resources, members are free to find their own doctors, and they will still be eligible for sharing (as long as they follow the standard procedures set forth by the ministry).

When it comes to emergency care, ministry members use the best available option and submit their bills for sharing afterward. The health care sharing ministries will seek to honor requests to share even expensive emergency care (provided the emergency care meets their standards).

Health Care Sharing Ministries vs. Insurance Companies

It’s crucial to understand that health care sharing ministries are not insurance companies. They operate more like nonprofit organizations. And because they are not technically insurance companies, they have no contractual obligation to share certain medical expenses. That means they can mostly write their own rulebook for what they expenses will share and what they won’t.

Each health care sharing ministry has full discretion over which treatments it will share, and ministries will not share expensese for many treatments or conditions that do not align with their religious ideals. For example, many ministries won’t cover treatment for drug or alcohol addictions. Medi-Share, for example, will typically not share expenses for prenatal care for an unmarried woman or health care for children born to unwed mothers. These are costs that traditional insurers would cover without hesitation.

There are also limits to how much health care sharing ministries are willing to share. The majority of ministries have a maximum sharing amount of $125,000-$1 million per incident. In contrast, government-approved health insurance plans do not have annual or lifetime maximums for insurance coverage. That’s not to say that these ministries can’t absorb large costs. Samaritan Ministries participants share $18 million per month in medical costs. Currently, Liberty HealthShare has a sharing capacity of $6 million per month among 30,000 households. Medi-Share and Christian Healthcare Ministries have shared more than $1 billion each.

Who can benefit the most from health care sharing ministries

At their heart, health care sharing ministries are meant to help members who are facing unusually high or unexpected health care costs. To that end, most ministries do not share the kinds of routine preventative care — like annual physicals and immunizations — that private insurers are required to cover. Commonly “shared” expenses among ministry members are things like sudden illness or surgeries, says Michael Gardner, a spokesperson for Medi-Share.

In a way, health care sharing ministries have replaced catastrophic health plans that were phased out under the Affordable Care Act. People who may not require regular doctor’s visits but who want a health plan for emergency health care needs might benefit from a health care sharing ministry.

melanie
Melanie Moore, 33, decided to remove her infant daughter from her Samaritan health care ministry plan because the plan did not share her newborn well visit expenses. She continues to use the ministry for her own health benefits.

Because these ministries don’t share expenses for routine health costs, health care sharing ministries make sense for people with low routine health care costs. In general, this includes many healthy people who don’t struggle with chronic conditions.

One surprising group that needs to look out for high routine costs are new parents.

In early 2016, Matthew and Melanie Moore gave birth to their second child. After the birth, the Moores chose to enroll the children on Matthew’s insurance plan instead of keeping them on the Samaritan plan, which wouldn’t share any of their newborn well visit expenses.

Infants visit the doctor 9-10 times in their first 18 months, and they receive dozens of immunizations during that time. For the Moores, the out-of-pocket costs for preventive care would have overwhelmed their budget again.

Health Care Sharing Ministries in the Obamacare Era

Under the guidelines of the Affordable Care Act, health care sharing ministries would never pass muster. But five of the six large health care sharing ministries were granted exemptions under the ACA — meaning their members will not have to pay tax penalties for not having qualified health coverage.

Please note: Members of Medical Cost Sharing (MCS), another ministry, will not receive qualified exemptions from Affordable Care Act penalties. Their website uses language that may lead you to believe otherwise.

Faith (Almost Always) Required

Health care sharing ministries have been around since the 1980s, led by Christian Healthcare Ministries. Like Melanie and her family, most health care sharing ministry participants are drawn to the organizations’ emphasis on faith.

The organizations model their sharing plan after resource sharing ideals practiced by the early Christian church nearly 2,000 years ago.

All the health care sharing ministries require that their members affirm some set of beliefs. Most specifically, they require participants to adhere to the Christian faith. Liberty HealthShare is an exception, according to Bellis. “We are unabashedly a Christian organization, but we don’t intrude on the faith choices of participants,” he says.

Bruno, of Altrua Healthshare, explained that members of Altrua adhere to a statement of standards instead of a statement of beliefs. The standards are based on the Bible, but the ministry is non-denominational.

One reason Melanie Moore loves health care sharing ministries is the sense of community and encouragement she receives from other members. She received notes of congratulations and prayers for recovery when she received checks to pay for her child’s delivery. Likewise, she sends notes of encouragement along with her monthly share check.

All the health care sharing ministries encourage participants to pray and give words of encouragement to sick participants. The ministries exist to foster community and to promote sharing. Anyone looking for an impersonal experience will need to look elsewhere.

Each of the ministries is faithful to its heritage. These ministries are faith-centered, and they want to promote religious faith among their members. It is clear that these ministries want members to share more than medical bills. They want to promote a community of care among their members.

The Bottom Line

Walking the line between faith and finances hasn’t been easy for the Moore family. Melanie is still a member of Samaritan, but the rest of the family is on Matthew’s traditional insurance plan.

Like the Moores, anyone considering a health care sharing ministry should think about their mindset, their faith, and their finances. Don’t join a ministry because of the low monthly costs; the organizations want members who live out the belief statements. Be sure that the rewards of joining a ministry (both financial and otherwise) outweigh the associated risks.

*This post has been updated to reflect the following correction: Due to a reporting error, the name of the ministry used by the Moore family was incorrectly noted. It is Samaritan Ministries, not Medi-Share.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Hannah Rounds
Hannah Rounds |

Hannah Rounds is a writer at MagnifyMoney. You can email Hannah here

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5 Ways to Keep Medical Debt From Ruining Your Credit

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

iStock

Your physical well-being isn’t the only thing at stake when you go to the hospital. So, too, is your financial health.

According to the Consumer Financial Protection Bureau, more than half of all collection notices on consumer credit reports stem from outstanding medical debt, and roughly 43 million consumers – nearly 20% of all those in the nationwide credit reporting system – have at least one medical collection on their credit report.

Now, you might be inclined to think that, because you’re young or have both a job and health insurance, medical debt poses you no risk. Think again. According to a report from the Kaiser Family Foundation, roughly one-third of non-elderly adults report difficulty paying medical bills. Moreover, roughly 70% of people with medical debt are insured, mostly through employer-sponsored plans.

Not concerned yet? Consider that a medical collection notice on your credit report, even for a small bill, can lower your credit score 100 points or more. You can’t pay your way out of the mess after the fact, either. Medical debt notifications stay on your credit report for seven years after you’ve paid off the bill.

The good news is that you can often prevent medical debt from ruining your credit simply by being attentive and proactive. Here’s how.

Pay close attention to your bills

Certainly, a considerable portion of unpaid medical debt exists on account of bills so large and overwhelming that patients don’t have the ability to cover them. But many unpaid medical debts catch patients completely by surprise, according to Deanna Hathaway, a consumer and small business bankruptcy lawyer in Richmond, Va.

“Most people don’t routinely check their credit reports, assume everything is fine, and then a mark on their credit shows up when they go to buy a car or home,” Hathaway said.

The confusion often traces back to one of two common occurrences, according to Ron Sykstus, a consumer bankruptcy attorney in Birmingham, Ala.

“People usually get caught off guard either because they thought their insurance was supposed to pick something up and it didn’t, or because they paid the bill but it got miscoded and applied to the wrong account,” Sykstus said. “It’s a hassle, but track your payments and make sure they get where they are supposed to get.”

Stay in your network

One of the major ways insured patients wind up with unmanageable medical bills is through services rendered – often not known to the patient – by out-of-network providers, according to Kevin Haney, president of A.S.K. Benefit Solutions.

“You check into an in-network hospital and think you’re covered, but while you’re there, you’re treated by an out-of-network specialist such as an anesthesiologist, and then your coverage isn’t nearly as good,” Haney said. “The medical industry does a poor job of explaining this, and it’s where many people get hurt.”

According to Haney, if you were unknowingly treated by an out-of-network provider, it’s would not be unreasonable for you to contact the provider and ask them to bill you at their in-network rate.

“You can push back on lack of disclosure and negotiate,” Haney said. “They’re accepting much lower amounts for the same service with their in-network patients.”

Work it out with your provider BEFORE your bills are sent to collections

Even if you’re insured and are diligent about staying in-network, medical bills can still become untenable. Whether on account of a high deductible or an even higher out-of-pocket maximum, patients both insured and uninsured encounter medical bills they simply can’t afford to pay.

If you find yourself in this situation, it’s critical to understand that most health care providers turn unpaid debt over to a collection agency, and it’s the agency that in turn reports the debt to the credit bureaus should it remain unpaid.

The key then is to be proactive about working out an arrangement with your health care provider before the debt is ever sent to a collection agency. And make no mistake – most providers are more than happy to work with you, according to Howard Dvorkin, CPA and chairman of Debt.com.

“The health care providers you owe know very well how crushing medical debt is,” he said. “They want to work with you, but they also need to get paid.”

If you receive a bill you can’t afford to pay in its entirety, you should immediately call your provider and negotiate.

“Most providers, if the bill is large, will recognize there’s a good chance you don’t have the money to pay it off all at once, and most of the time, they’ll work with you,” Dvorkin said. “But you have to be proactive about it. Don’t just hope it will go away. Call them immediately, explain your situation and ask for a payment plan.”

If the bill you’re struggling with is from a hospital, you may also have the option to apply for financial aid, according to Thomas Nitzsche, a financial educator with Clearpoint Credit Counseling Solutions, a personal finance counseling firm.

“Most hospitals are required to offer financial aid,” Nitzsche said. “They’ll look at your financials to determine your need, and even if you’re denied, just the act of applying usually extends the window within which you have to pay that bill.”

Negotiate with the collection agency

In the event that your debt is passed along to a collection agency, all is not immediately lost, Sykstus said.

“You can usually negotiate with the collection agency the same as you would with the provider,” he said. “Tell them you’ll work out a payment plan and that, in return, you’re asking them to not report it.”

Most collection agencies, according to Haney, actually have little interest in reporting debt to the credit bureaus.

“The best leverage they have to get you to pay is to threaten to report the bill to the credit agencies,” he said. “That means as soon as they report it, they’ve lost their leverage. So, they’re going to want to talk to you long before they ever report it to the bureau.

“Don’t duck their calls,” he added. “Talk to them and offer to work something out.”

Take out a personal loan

Refinancing your medical debt into a personal loan is another move you can consider making, particularly if you can get a lower interest rate than you could with a credit card, and you aren’t able to secure a 0% credit card deal. Peer-to-peer lenders LendingClub and Prosper both start with APRs as low as 6.95%, and LendingClub’s origination fee starts as low as 1%.

Even better, SoFi offers personal loans at a rate as low as 5.99% and has no origination fee (although you do need a relatively high minimum credit score to get a loan, at 680).

MagnifyMoney’s parent company, LendingTree, features a handy personal loan tool where you can shop for the best loan for you.

Bottom line

Dealing with medical debt can be particularly stressful, as you have to worry about money matters along with managing health issues. However, having medical debt does not have to spell disaster. If you follow one or more of the steps above, you should be able to keep your finances healthy.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

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Featured, Health, News

How Weight Loss Helped This Couple Pay Down $22,000 of Debt

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Photo courtesy of Brian LeBlanc

Brian LeBlanc was fed up. The 30-year-old policy analyst from Alberta, Canada, had struggled with his weight for years. At the time, he weighed 240 pounds and had trouble finding clothes that fit. He decided it was time to change his lifestyle for good.

LeBlanc started running and cutting back on fast food and soft drinks. He ordered smaller portions at restaurants and avoided convenience-store foods. About a year into his weight-loss mission, his wife Erin, 31, joined him in his efforts.

“The biggest change we made was buying a kitchen food scale and measuring everything we eat,” Brian says. “Creating that habit was really powerful.”

Over two years, the couple shed a total of 170 pounds.

But losing weight, they soon realized, came with an unexpected fringe benefit — saving thousands of dollars per year. Often, people complain that it’s expensive to be healthy — gym memberships and fresh produce don’t come cheap, after all. But the LeBlancs found the opposite to be true.

Erin, who is a payroll specialist, also managed their household budget. She began noticing a difference in how little money they were wasting on fast food and unused grocery items.

Photo courtesy of Brian LeBlanc

“Before, we always had the best intentions of going to the grocery store and buying all the healthy foods. But we never ate them,” she says. “We ended up throwing out a lot of healthy food, vegetables, and fruits.”

Before their lifestyle change, Brian and Erin would often eat out for dinner, spending as much as $80 per week, and they would often go out with friends, spending about $275 a month. Now, Brian says if they grab fast food, they choose a smaller portion. Now they might spend only $22 on fast food per month, instead of over $200.

What’s changed the most is how they shop for groceries, what they buy and how they cook. Brian likes to prep all his meals on Sunday so his lunches during the week are consistent and portion-controlled. They also buy only enough fresh produce to last them a couple of days to prevent wasting food.

Losing weight — and student loan debt

Photo courtesy of Brian LeBlanc

Two years after the start of their weight-loss journey, they took a look at their bank statements to see how their spending had changed. By giving up eating out and drinking alcohol frequently, they were spending $600 less a month than they used to, even though they’ve had to buy new wardrobes and gym memberships.

With their newfound savings, the LeBlancs managed to pay off Brian’s $22,000 in student loans 13 years early. Even with the $600 they were now saving, they had to cut back significantly on their budget to come up with the $900-$1,000 they aimed to put toward his loans each month. They stopped meeting friends for drinks after work, and Erin took on a part-time job to bring in extra cash. When they needed new wardrobes because their old clothing no longer fit, they frequented thrift shops instead of the mall.

When they made the final payment after two years, it was a relief to say the least.

Now the Canadian couple is saving for a vacation home in Phoenix, which they hope to buy in the next few years, and they’re planning to tackle Erin’s student loans next. They’re happy with their weight and lives in general, but don’t take their journey for granted.

“There were times we questioned our sanity, and we thought we cannot do this anymore,” says Erin. But they would always rally together in the end.

“There are things that are worth struggling for and worth putting in the effort,” Brian says. “Hands down, your health is one of those things.”

Other Ways Getting Healthy Can Help Financially

Spending less on food isn’t the only way your budget can improve alongside your health. Read below to see how a little weight loss can tip the scales when it comes to your finances.

  • Spend less on medical bills. Health care costs have skyrocketed over the past two decades, but they’ve impacted overweight and obese individuals more. A report on the “state of obesity” in America found that obese adults spend 42% more on healthcare per year than those of normal weight.
  • Buy cheaper clothes. Designers frequently charge more for plus-size clothing than smaller sizes. Some people claim retailers add a “fat tax” on clothes because there are fewer options for anyone over a size 12. It might not be fair, but it’s the way things are.
  • Save on life insurance. Your health is a huge factor for life insurance rates. Annual premiums for a healthy person can cost more than for someone who is overweight, because BMI (body mass index) may be a factor for determining pricing.

Getting Healthy for Cheap

Still worried that an active lifestyle will require you to spend more money? Here are some tips on keeping costs low while you improve your lifestyle.

  • Get a family membership. Gyms often provide a discount if you sign up for a family membership instead of an individual one. Most of these deals are only beneficial for households with children, but some might offer a lower price if you sign up with a spouse or partner. Always ask the gym about any special deductions they might have.
  • Skip the fancy gym. Many would-be exercisers skip the gym pass because they assume it will be expensive. Before you give up, call around and compare prices. Try your local YMCA, as they often have income-based membership.
  • Shop at thrift stores. Finding inexpensive workout clothes can be another barrier to exercising. Who wants to spend $75 on yoga pants? Don’t visit the mall for your new duds. Your local thrift shop or consignment store will have running shorts and tank tops for only a few dollars. Secondhand clothes also make more sense if you’re in the midst of losing a lot of weight and changing sizes frequently.
  • Go vegetarian. Meat is often the most expensive item in your grocery cart. If you’re trying to eat healthier and concerned about money, try vegetarian protein options like lentils, beans,and quinoa. You don’t have to fully adopt the vegetarian lifestyle, but just reducing your meat intake can have a significant impact on the grocery bill.
  • Buy frozen produce. Frozen produce is often as healthy as buying fresh, but it can be significantly less expensive. Frozen veggies and fruit also last longer, decreasing the risk of food waste. You can often find coupons, and the long shelf life makes it easy to stock up if there’s a sale on your favorite green beans.
  • Cut back on eating out. Ever wonder how restaurant-quality food can be so much better than what you make at home? You guessed it: more salt, more sugar, more butter and more fat. By limiting the meals you eat out, you’ll avoid all that — as well as those outrageous restaurant markups. If you do eat out, you can do your best to pick the healthy choice. You may also choose to take advantage of cashback credit cards that may reward you for your healthy dining out.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Zina Kumok
Zina Kumok |

Zina Kumok is a writer at MagnifyMoney. You can email Zina here